CORPORATE INFORMATION

BOARD OF DIRECTORS Kalanithi Maran Executive Chairman K. Vijaykumar Managing Director & Chief Executive Officer S. Selvam Director Kavery Kalanithi Executive Director J. Ravindran Independent Director M.K. Harinarayanan Independent Director Nicholas Martin Paul Independent Director . Ravivenkatesh Independent Director

COMPANY SECRETARY R. Ravi & COMPLIANCE OFFICER

BANKERS Andhra Bank Axis Bank City Union Bank Corporation Bank HDFC Bank ICICI Bank Indian Bank Indian Overseas Bank Karur Vysya Bank Kotak Mahindra Bank Ratnakar Bank Standard Chartered Bank State Bank of India Bank

AUDITORS M/s S.R. Batliboi & Associates LLP Chartered Accountants, 6th & 7th Floor - 'A' Block (Module 601,701,702) Tidel Park, No. 4, Rajiv Gandhi Salai, Taramani, Chennai - 600 113.

SECRETARIAL AUDITORS M/s. Lakshmmi Subramanian & Associates Company Secretaries, Murugesa Naicker Office Complex, No. 81, Greams Road, Chennai - 600 006.

REGISTERED OFFICE Murasoli Maran Towers, 73, MRC Nagar Main Road, MRC Nagar, Chennai - 600 028. www.suntv.in

REGISTRAR AND SHARE TRANSFER AGENT M/s Karvy Computershare Private Limited, Plot Nos.17 to 24, Vittal Rao Nagar, Madhapur, Hyderabad - 500 081. www.karvycomputershare.com

01 Annual Report 2014-2015 Sun TV Network Limited

AUDIT COMMITTEE J. Ravindran Chairman M.K. Harinarayanan Nicholas Martin Paul R. Ravivenkatesh

NOMINATION & REMUNERATION COMMITTEE J. Ravindran Chairman M.K. Harinarayanan Nicholas Martin Paul R. Ravivenkatesh

STAKEHOLDERS RELATIONSHIP COMMITTEE M.K. Harinarayanan Chairman J. Ravindran Nicholas Martin Paul R. Ravivenkatesh

MANAGEMENT Kalanithi Maran Executive Chairman K. Vijaykumar Managing Director & Chief Executive Officer Kavery Kalanithi Executive Director V. C. Unnikrishnan Chief Financial Officer C. Praveen Chief Operating Officer S. Kannan Chief Technical Officer R. Ravi Company Secretary & Compliance Officer

Contents Page Nos. Financial Performance 3 Directors Report 4 - 31 Management Discussion and Analysis Report 32 - 37 Corporate Governance Report 38 - 52 Business Responsibility Report 53 - 62 Independent Auditors’ Report on Standalone Financial Statements 63 - 67 Standalone Financial Statements 68 - 108 Statement Pursuant to Section 212 109 Independent Auditors’ Report on Consolidated Financial Statements 110 - 116 Consolidated Financial Statements 117 - 167

02 Annual Report 2014-2015 73% 37% 47% 35% 19.29 6.85 61.86 676.95 726.40 195.12 531.28 1 408.90 50% 2006-07 2006-07 50% 74% 40% 43% 27% 9.31 13.03 37.32 1 861.06 925.99 239.18 686.81 568.22 2007-08 2007-08 50% 1.09 78% 40% 41% 27% 1 45.49 236.61 854.91 184.92 666.10 2008-09 1,008.20 1,091.52 2008-09 80% 39% 45% 30% 150% 14.40 51.13 284.46 285.44 866.42 2009-10 2009-10 1,395.01 1,437.52 1,153.06 YEARS 1 1 81% 39% 52% 35% 175% 19.60 60.54 365.82 447.38 2010-1 2010-1 1,923.71 1,970.50 1,604.68 1,155.32 1-12 81% 38% 40% 28% 1-12 190% 17.63 67.12 356.70 443.00 2007 - 08 201 201 1,757.37 1,831.57 1,474.87 1,026.32 76% 36% 36% 25% 190% 17.34 73.41 440.73 413.18 PERFORMANCE FOR LAST 9 2012-13 1817.62 2012-13 1,872.64 1,431.91 1,013.94 71% 33% 35% 24% 190% 18.19 80.49 FINANCIAL 635.07 453.34 2013-14 2013-14 2,096.78 2,175.99 1,542.59 1,084.71 All amounts are in Crores of Indian Rupees, unless otherwise stated ) ( 2. Bonus Issue in the ratio 1:1 FY 73% 32% 34% 23% 1.99 1 18.71 85.76 225% 629.41 587.83 2014-15 2014-15 1,1 2,243.62 2,331.45 1,702.04 Amortisation ax alue per share – Rs. 5/- T % alue per share (Rs.) otal Income Particulars Particulars Revenue Earnings per share (Rs.) T Book V Operating Expenditure PBITDA PBITDA Profit Margin % ROCE % Depreciation & RONW % Profit before Notes: 1. Face V Equity Dividend % Financial Highlights Key Indicators

03 Annual Report 2014-2015 Sun TV Network Limited

REPORT OF THE DIRECTORS TO THE SHAREHOLDERS

Your Directors are pleased to present the Thirtieth Annual Report and Audited Financial Accounts of the Company for the financial year ended 31st March 2015.

FINANCIAL HIGHLIGHTS The financial highlights for the year ended 31st March 2015 are given below:

(Rs. in Crores)

Particulars For the year ended 31st March, 2015 31st March, 2014 Total Income 2,331.45 2,175.99 Total Expenditure 1,217.24 1,088.41 (Excluding Interest &Financial Charges) Profit before interest and tax 1,114.21 1,087.58 Interest & Financial Charges 2.22 2.87 Profit Before Tax 1,111.99 1,084.71 Provision for Taxation 374.76 367.75 Profit after tax 737.23 716.96 Accumulated Profit, beginning of the year 2,019.14 1,811.89 Interim Dividend (443.35) (285.71) Tax on Interim Dividend (85.98) (48.56) Proposed Dividend - (88.67) Tax on Proposed Dividend - (15.07) Transfer to General Reserve - (71.70) Profit Carried Forward 2,227.04 2,019.14 Earnings Per Share (Face value Rs.5/-) 18.71 18.19

SUMMARY OF OPERATIONS: The total Income for the year ended 31st March 2015 was Rs. 2,331.45 crores as against Rs. 2,175.99 crores during the previous year ended 31st March 2014. Profit Before Tax was Rs. 1,111.99 crores as against Rs. 1,084.71 crores in the previous year. Profit After Tax was Rs. 737.23 crores as against Rs. 716.96 crores in the previous year.

BUSINESS OVERVIEW Your Company, one of the largest Television Broadcasters in India operating Channels across four languages of Tamil, Telugu, Kannada and Malayalam and presently airing FM radio stations across India continues to have sustained and increased viewership of its channels.

DIVIDEND: During the financial year ended 31st March 2015, the Board of Directors has declared Interim Dividends of Rs. 2.25/- per equity share (45%), Rs. 2.25/- per equity share (45%) and Rs. 6.75/- per equity share (135%) declared at the Board Meetings held on August 8, 2014, November 7, 2014 and February 6, 2015 respectively and have not recommended any Final Dividend. The dividend payout would result in a total dividend of 225%, i.e., Rs. 11.25/- per equity share of face value of Rs. 5.00/- each for the financial year ended 31st March 2015. (Prev. Year of 190%, i.e., Rs. 9.50/- per equity share of face value of Rs. 5.00/- each). The Payout ratio currently stands at 71.80%.

04 Annual Report 2014-2015 REPORT OF THE DIRECTORS TO THE SHAREHOLDERS

DIRECTORS’ RESPONSIBILITY STATEMENT

In terms of Section 134 (3) (c) and 134 (5) of the Companies Act, 2013 your Directors confirm that, to the best of their knowledge and belief: ÞIn the preparation of the Statement of Profit & Loss for the financial year ended 31st March, 2015 and Balance Sheet as at that date (“financial statements”), the applicable Accounting Standards have been followed along with proper explanation relating to material departures;

ÞAppropriate accounting policies have been selected and applied them consistently and made such judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at the end of the financial year and of the profit of the Company for that period;

ÞProper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities. To ensure this, the Company has established internal control systems, consistent with its size and nature of operations. In weighing the assurance provided by any such system of internal controls its inherent limitations should be recognized. These systems are reviewed and updated on an ongoing basis. Periodic internal audits are conducted to provide reasonable assurance of compliance with these systems. The Audit Committee meets at regular intervals to review the internal audit function;

ÞThe financial statements have been prepared on a going concern basis.

ÞProper internal financial controls were in place and that the financial controls were adequate and were operating effectively.

ÞProper systems are in place to ensure compliance of all laws applicable to the Company;

DIRECTORS AND KEY MANAGERIAL PERSONNEL

As per the provisions of the Companies Act, 2013, Mr. K. Vijaykumar, Managing Director of the Company will retire at the ensuing AGM and being eligible, seeks re-appointment. The Board of Directors recommend his re-appointment.

The information on the particulars of director eligible for re-appointment in terms of Clause 49 of the Listing Agreement has been provided in annexure to the notice convening the Annual General Meeting.

None of the Company's directors are disqualified from being appointed as a director as specified in Section 164 (2) of the Companies Act, 2013.

CORPORATE GOVERNANCE REPORT, MANAGEMENT DISCUSSION & ANALYSIS REPORT AND OTHER INFORMATION REQUIRED UNDER THE COMPANIES ACT, 2013 AND LISTING AGREEMENT.

As required under Clause 49 of the Listing Agreement with the Stock exchanges, we continue to be a pioneer in benchmarking our corporate governance policies with the best in the media industry. The report on Management Discussion and Analysis, Corporate Governance as well as the Auditors’ certificate regarding compliance of conditions of Corporate Governance forms part of the Annual Report.

05 Annual Report 2014-2015 Sun TV Network Limited

REPORT OF THE DIRECTORS TO THE SHAREHOLDERS

Various information required to be disclosed under the Companies Act, 2013 and Listing Agreement is set out in the Annexure - I and forms part of this report.

BUSINESS RESPONSIBILITY REPORT: As mandated by SEBI and as per Clause 55 of the Listing Agreement with the Stock Exchanges, the Business Responsibility Report (“BR report”) describing the initiatives taken by the Company from an Environmental, Social and Governance (“ESG”) perspective as per SEBI’s prescribed format, which is also in line with the ‘National Voluntary Guidelines on Social, Environmental and Economic Responsibilities of Business’ as prescribed by the Ministry of Corporate Affairs, has been adopted by the Company for the financial year 2014-15; which forms a part of the Annual Report. The Business Responsibility Report is also available on our website.

AUDITORS AND SECRETARIAL AUDITORS REPORT Pursuant to the provisions of Section 139 and other applicable provisions, if any, of the Companies Act, 2013 and the Rules framed thereunder, as amended from time to time, the appointment of M/s. S.R. Batliboi & Associates LLP, Chartered Accountants, (ICAI Firm Registration No: 101049W) as the Auditors of the Company approved by the shareholders at the 29th Annual General Meeting (AGM), for a term of three years, i.e. till the conclusion of 32nd AGM, which was subject to ratification at every AGM, be and is hereby ratified to hold the office from the conclusion of this AGM till the conclusion of the 31st AGM of the Company to be held in the year 2016, at such remuneration plus applicable taxes, out-of-pocket expenses, etc., as may be mutually agreed between the Board of Directors of the Company and the Auditors.

As per the provisions of Section 204 of the Companies Act, 2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed M/s. Lakshmmi Subramanian & Associates, a firm of Company Secretaries in Practice to undertake the Secretarial Audit of the Company. The Secretarial Audit Report is annexed herewith as Annexure VI.

There are no disqualifications, reservations or adverse remarks or disclaimers in the Auditors and Secretarial Auditors Report.

CORPORATE SOCIAL RESPONSIBILITY (CSR) The Corporate Social Responsibility Committee of the Board of Directors of the Company has, in accordance with Section 135 of the Companies Act, 2013 approved a CSR policy. The CSR Policy of the Company and the details about the initiatives taken by the Company on CSR during the year as per the Companies (Corporate Social Responsibility Policy) Rules, 2014 have been disclosed in Annexure II to this Report along with a compliance certificate from Secretarial Auditor. Further details relating to the Corporate Social Responsibility Committee are provided in the Corporate Governance Report, which forms part of this report.

SUBSIDIARY COMPANIES Your Company has two subsidiaries viz., Kal Radio Limited and South Asia FM Limited. There has been no material change in the nature of business of the subsidiaries. Shareholders interested in obtaining a copy of the audited annual accounts of the subsidiary companies may write to the Company Secretary. In terms of proviso to sub section (3) of Section 129 of the Act, the salient features of the financial statement of the subsidiaries is set out in the prescribed Form AOC – 1 which forms part of the annual report.

06 Annual Report 2014-2015 REPORT OF THE DIRECTORS TO THE SHAREHOLDERS

MATERIAL NON – LISTED SUBSIDIARY COMPANY As per Clause 49 of the Listing Agreement, your Company has no material non – listed subsidiary company, whose turnover or net worth exceeds 20% of the consolidated turnover or net worth respectively of your Company and its subsidiaries in the immediately preceding accounting year.

TRANSFER TO THE INVESTOR EDUCATION AND PROTECTION FUND In terms of Section 125(2) of the Companies Act, 2013, an amount of Rs. 0.76 Lakhs being unclaimed dividend, will be transferred during the current year to the Investor Education and Protection Fund established by the Central Government.

PUBLIC DEPOSITS Your Company has not accepted any Deposits from the public in terms of Section 73 of the Companies Act, 2013 during the financial year ended 31st March 2015.

PARTICULARS OF EMPLOYEES Sun TV Network Limited had 2005 employees as on 31st March 2015 (previously 2032). In accordance with the provisions of Section 197 (12) of the Companies Act, 2013 read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 the required information is annexed and forms part of this Report. However, as per the provisions of Section 136 of the Companies Act, 2013, the Directors Report is being sent to all the Shareholders of the Company excluding the aforesaid annexure. Any shareholder interested in obtaining a copy of the said annexure may write to the Company Secretary at the Registered Office of the Company.

INFORMATION AS REQUIRED UNDER SECTION 134(3)(m) OF THE COMPANIES ACT, 2013 READ WITH RULE 8(3) OF THE COMPANIES (ACCOUNTS) RULES, 2014

(A) CONSERVATION OF ENERGY The Company is engaged in Satellite operations and the information, as intended under Section 134 (3)(m) does not arise.

(B) TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION The Company uses the latest high definition (HD) digital technology in broadcasting its programs. The outdated technologies are constantly identified and updated with latest innovations.

(C) FOREIGN EXCHANGE EARNINGS AND OUTGO (Rs. in Crores)

PARTICULARS 31st March 2015 31st March 2014

Foreign Exchange Earnings 148.85 125.50

Foreign Exchange Outgo 60.86 46.47

07 Annual Report 2014-2015 Sun TV Network Limited

REPORT OF THE DIRECTORS TO THE SHAREHOLDERS

CONSOLIDATED FINANCIAL STATEMENTS As required by Accounting Standard – AS 21 on Consolidated Financial Statements issued by The Institute of Chartered Accountants of India, the Audited Consolidated Financial Statements of the Company are attached. The Audited Consolidated Financial Statements also account for the minority interest of your Company’s subsidiary South Asia FM Limited pursuant to the strategic alliance with Red FM.

CEO / CFO CERTIFICATION The Managing Director & Chief Executive Officer and the Chief Financial Officer have submitted a certificate to the Board regarding the financial statements and other matters as required under Clause 49(IX) of the Listing Agreement, which forms part of the report.

APPRECIATION AND ACKNOWLEDGEMENT Your Directors take this opportunity to place on record their deep appreciation of the dedication, hard work, solidarity, co-operation, support and commitment of employees at all levels in maintaining the sustained growth of your Company and remain in the forefront of media and entertainment business.

Your Directors thank and express their gratitude for the support and co-operation received from the Central and State Governments – mainly the Ministry of Information and Broadcasting and the Department of – and other stakeholders including viewers, producers, vendors, financial institutions, banks, investors, service providers as well as regulatory and governmental authorities and stock exchanges, for their continued support.

On behalf of the Board

Place: Chennai Kalanithi Maran Date: May 29, 2015 Chairman

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08 Annual Report 2014-2015 ANNEXURE - I

1. CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY The CSR Policy of the Company and the details about the initiatives taken by the Company on CSR during the year as per the Companies (Corporate Social Responsibility Policy) Rules, 2014 have been disclosed in Annexure II to this Report

2. EXTRACT OF ANNUAL RETURN The extract of Annual Return as provided under Section 92 (3) of the Companies Act, 2013 is enclosed in Annexure III in the prescribed form MGT – 9 and forms part of this Report.

3. NUMBER OF MEETINGS OF THE BOARD During the year, four Board Meetings were held. The details of meetings are furnished in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

4. INDEPENDENT DIRECTORS’ DECLARATION All Independent Directors have given declarations that they meet the criteria of independence as laid down under Section 149 (6) of the Companies Act, 2013 and revised Clause 49 of the Listing Agreement.

5. POLICY OF DIRECTORS’ APPOINTMENT AND REMUNERATION The Company’s policy on Director’s appointment and remuneration including criteria for determining qualifications, positive attributes, independence of a director and other matters provided in Section 178 (3) of the Companies Act, 2013 are covered in the Corporate Governance Report which forms part of the report. Further, information about elements of remuneration package of individual directors are provided in the extract of Annual Return as provided in the Annexure III, in the prescribed form MGT – 9.

6. PARTICULARS OF LOANS, GUARANTEES AND INVESTMENT Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the Financial Statements.

7. TRANSACTIONS WITH RELATED PARTIES The information on material transactions with related parties pursuant to Section 134 (3) (h) of the Act, read with rule 8(2) of the Companies (Accounts) Rules, 2014, in Form AOC – 2 is annexed to this report as Annexure IV.

8. INTERNAL CONTROL The information about internal controls is set out in the Management Discussion & Analysis Report, which is attached and forms part of the report.

9. RISK MANAGEMENT As per the Clause 49 of the Listing Agreement, the Board has constituted a Risk Management Committee comprising of Independent Directors. The Risk Management is overseen by the

09 Annual Report 2014-2015 Sun TV Network Limited

ANNEXURE - I

Risk Management Committee of the Company on a continuous basis. Major risks identified by the businesses and functions are systematically addressed through mitigating actions on a continuous basis. For details, please refer to the Management Discussion and Analysis report which forms part of the report.

10. FAMILIARIZATION PROGRAMME FOR INDEPENDENT DIRECTORS The Company has practice of conducting familiarization programme of the independent directors as detailed in the Corporate Governance Report which forms part of the Annual Report.

11. VIGIL MECHANISM / WHISTLE BLOWER POLICY As per Section 177 of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Company has a vigil mechanism to deal with instance of fraud and mismanagement, if any. The details of policy are explained in the Corporate Governance Report.

12. PERFORMANCE AND FINANCIAL POSITION OF SUBSIDIARIES The financial position of each of the subsidiaries is provided in a separate statement AOC – 1, attached to the Financial Statement pursuant to first proviso of Section 129(3) of the Companies Act, 2013 as Annexure -V.

13 INDEPENDENT DIRECTOR’S MEETING As per the Clause 49 of the Listing Agreement, a separate meeting of Independent Directors was held during the year. The detailed information is explained in the Corporate Governance Report.

14 BOARD EVALUATION Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out a formal annual performance evaluation of its own performance, the directors individually as well as the functioning of its committees. A detailed explanation has been given in the Corporate Governance Report.

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10 Annual Report 2014-2015 ANNEXURE II : ANNUAL REPORT ON CORPORATE SOCIAL RESPONSIBILITY (CSR) ACTIVITIES (Section 135 of the Companies Act, 2013 read with The Companies (CSR Policy) Rules, 2014)

1. A brief outline of the Company’s CSR policy, including overview of projects or programmes proposed to be undertaken and a reference to the web-link to the CSR policy and projects or programmes

The Corporate Social Responsibility Committee of the Board had approved a CSR policy with primary focus on health care, women empowerment, environmental sustainability and contributing to rural development projects. Besides these focus areas, the Company shall also undertake any other CSR activities listed in Schedule VII of the Companies Act, 2013.

The CSR Policy of the Company can be viewed on http://www.suntv.in

2. Composition of the CSR Committee Mr. K. Vijaykumar - Chairman Mrs. Kavery Kalanithi - Member Mr. Nicholas Martin Paul - Member

3. Average net profit of the company for the last three financial years – Rs.1,039.63 Crore

4. Prescribed CSR Expenditure (two percent of the amount as in item 3 above)

The Company is required to spend Rs. 20.79 Crore towards CSR.

5. Details of CSR spend during the financial year: a) Total amount to be spent for the financial year – Rs. 20.79 Crore b) Amount unspent, if any – Rs. 15.17 Crore c) Manner in which the amount spent during the financial year is detailed below : (Rs. in Crores)

Amount Cumulative Amount Outlay Amount spent Expenditure spent : Direct or S.No Projects/Activities Sector Locations (Budget) Project on the project upto through or Programs or programs the reporting implementing wise periods agency 1. Prime Minister’s Relief for Jammu & National Relief Fund flood Kashmir - 1.00 1.00 Direct affected people

2. The Andhra Pradesh Relief for Andhra - 3.50 3.50 Direct Chief Minister's Relief flood Pradesh Fund affected people

3. Education to poor Promoting Across - 1.12 1.12 Through Trust - children Education India Sun Foundation

Total 5.62 5.62

6. The Company has partially expended 2% of its average net profits made during the immediately three preceeding financial years as per section 135(5) of Companies Act, 2013 in pursuance of its corporate social responsibility policy since the company is yet to identify sutiable projects.

7. The implementation and monitoring of CSR Policy is in compliance with CSR objectives and policy of the Company.

K. Vijaykumar Nicholas Martin Paul Chairman of CSR Committee Director

11 Annual Report 2014-2015 Sun TV Network Limited

ANNEXURE III FORM MGT - 9 : EXTRACT OF ANNUAL RETURN

As on the financial year ended 31/03/2015 [Pursuant to section 92(3) of the Companies Act, 2013and Rule 12(1) of the Companies (Management and Administration) Rules, 2014]

I. REGISTRATION AND OTHER DETAILS:

CIN L22110TN1985PLC012491

Registration Date 18/12/1985

Name of the Company Sun TV Network Limited

Category/Sub - Category of the Company Public Company Limited by Shares

Address of the Registered Office Murasoli Maran Towers, 73, MRC Nagar Main Road, MRC Nagar, Chennai – 600028. Whether listed company Yes

Name, address of Registrar and M/s Karvy Computershare Private Limited, Transfer Agent, if any Plot Nos.17 to 24, Vittal Rao Nagar, Madhapur, Hyderabad - 500 081.

II. PRINCIPAL BUSINESS ACTIVITIES OF THE COMPANY:

All the business activities contributing 10% or more of the total turnover of the company shall be stated:-

S.No Name and Description of NIC Code of the % to total turnover of the main products / services Product/ service company

1. Broadcasting Services 92132 100%

III. PARTICULARS OF HOLDING, SUBSIDIARY AND ASSOCIATE COMPANIES:

S.No Name and address CIN / GLN Holding/ % of Applicable of the company Subsidiary/ shares Section Associate held

1. Kal Radio Limited U92131TN2005PLC057755 Subsidiary 97.78 % 2(87) Murasoli Maran Towers, 73, MRC Nagar Main Road, MRC Nagar, Chennai – 600028

2. South Asia FM Limited U92131TN2005PLC057987 Subsidiary 59.15 % 2(87) Murasoli Maran Towers, 73, MRC Nagar Main Road, MRC Nagar, Chennai – 600028

12 Annual Report 2014-2015 ANNEXURE III FORM MGT - 9: EXTRACT OF ANNUAL RETURN

IV. SHAREHOLDING PATTERN (Equity Share Capital Breakup as percentage of Total Equity)

I) Category-wise Share Holding:

No. of Shares held at the No. of Shares held at the beginning of the year end of the year % of Category Change of during Shareholders the Year % of Total % of Total Demat Physical Total Demat Physical Total Shares Shares

(A) Promoters

(1) Indian

(a) Individual / HUF 29,55,63,457 29,55,63,457 75.00 29,55,63,457 29,55,63,457 75.00 NIL (b) Central Govt ------

13 © State Govt (s) ------

Annual Report 2014-2015 (a)Bodies Corp. ------(b)Banks / FI ------(c)Any Other…. ------Sub-Total (A) (1) 29,55,63,457 - 29,55,63,457 75.00 29,55,63,457 - 29,55,63,457 75.00 NIL 14 Sun TVNetworkLimited Annual Report 2014-2015 ANNEXURE III FORM MGT - 9 : EXTRACT OF ANNUAL RETURN

No. of Shares held at the No. of Shares held at the beginning of the year end of the year % of Category Change of during Shareholders the Year % of Total % of Total Demat Physical Total Demat Physical Total Shares Shares

(2)

(a) NRIs - Individuals ------(b) Other - Individuals ------(c) Bodies Corp. ------(d) Banks / FI ------(e) Any Other…. ------Sub-Total (A) (2) ------Total Shareholding of Promoter (A)= (A) (1) + (A) (2) 29,55,63,457 - 29,55,63,457 75.00 29,55,63,457 - 29,55,63,457 75.00 NIL ANNEXURE III FORM MGT - 9: EXTRACT OF ANNUAL RETURN

No. of Shares held at the No. of Shares held at the beginning of the year end of the year % of Category Change of during Shareholders the Year

% of Total % of Total Demat Physical Total Demat Physical Total Shares Shares

(A) Public Shareholding

(1) Institutions

(a) Mutual Funds 75,19,197 75,19,197 1.91 39,25,105 - 39,25,105 1.00 (0.91) (b) Banks/FI 29,397 29,397 0.01 3,576 - 3,576 0.00 (0.01) (c) Central Govt ------(d) State Govt (s) ------(e) Venture Capital funds ------(f) Insurance Companies 3,25,000 - 3,25,000 0.08 25,000 - 25,000 0.01 (0.07) 15 (g) FIIs 6,30,61,063 - 6,30,61,063 16.00 7,46,47,477 - 7,46,47,477 18.94 2.94 Annual Report 2014-2015 (h) Foreign Venture Capital Funds ------(i) Others (Specify) ------Sub-Total (B)(1) 7,09,34,657 7,09,34,657 18.00 7,86,01,158 7,86,01,158 19.95 1.95 Sun TV Network Limited - NIL NIL 0.01 ear (1.24) (0.40) (0.19) (0.14) (1.95) Y % of during Change the - 0.08 0.46 4.44 0.05 0.02 5.05 otal 25.00 T 100.00 Shares % of - 78,466 otal 3,03,039 2,17,460 T 18,18,235 1,75,02,805 1,99,20,005 9,85,21,163 39,40,84,620 - 497 497 497 497 end of the year Physical No. of Shares held at the RETURN - 78,466 3,03,039 2,17,460 ANNUAL Demat 1,75,02,805 1,75,02,805 1,99,19,508 9,85,20,666 39,40,84,123

1.32 0.86 4.43 0.24 0.16 0.00 7.00 otal 25.00 T ANNEXURE III 100.00 Shares % of 2,000 otal 6,36,799 T FORM MGT - 9: EXTRACT OF 51,98,020 33,81,209 92,82,226 1,74,40,252 2,75,86,506 9,85,21,163 39,40,84,620 476 476 476 476 Physical beginning of the year No. of Shares held at the 2,000 9,28,226 6,36,799 51,98,020 33,80,733 Demat 1,74,40,252 2,75,86,030 9,85,20,687 39,40,84,144 ADRs otal of otal (B)(2) Category Bodies

Shareholders rust otal Public (2) a) Corporate I. Indian ii. Overseas (a) individuals I. Individual shareholders holding nominal share capital up to Rs. 1 lakh ii. Individual shareholders holding nominal share capital in excess of Rs 1 lakh NRIs Clearing Members T Sub-T T Shareholding = (B) (1) + (2) C. Shares held by custodian for GDRs & Grand T (A+B+C)

16 Annual Report 2014-2015 - NIL NIL ear 75.00 Y % of during Change the company % of total Shares of the - %of end of the year Shares Pledged / 2,98,78,909 2,98,78,909 encumbered No. of Shares 29,55,63,457 Cumulative Shareholding at the 75.00 75.00 % of total of the Shares company 75.00 end of the year Shareholding at the company % of total Shares of the RETURN No. of Shares 29,55,63,457 29,55,63,457 ANNUAL Shareholding at the beginning of the year No. of Shares 29,55,63,457

shares to total Pledged / 1,88,98,047 1,88,98,047 %of Shares encumbered ANNEXURE III 75.00 75.00 % of total of the Shares company , if there is no change): FORM MGT - 9: EXTRACT OF Shareholding at the beginning of the year No. of Shares 29,55,63,457 29,55,63,457

Shareholding ( please specify otal T Name Date wise Increase / Decrease in Promoters Share holding during the year specifying reasons for increase / decrease (e.g.allotment transfer / bonus/ sweat equity etc): At the End of year At the beginning of year Particulars Shareholders’ . Kalanithi Maran Mr S. No. S. No. 1 (ii) Shareholding of Promoters: (iii) Change in Promoters’

17 Annual Report 2014-2015 18 Sun TVNetworkLimited Annual Report 2014-2015 ANNEXURE III FORM MGT - 9: EXTRACT OF ANNUAL RETURN

(iv) Shareholding Pattern of top ten Shareholders (other than Directors, Promoters and Holders of GDRs and ADRs):

Shareholding at the Cumulative Shareholding at the beginning of the year end of the year For Each of the Top 10 Shareholders % of total % of total No. of No. of S. No. Shares of the Shares of the Shares company Shares company

1. Selvam Selvi 71,51,720 1.82 71,16,720 1.81 2. DVI Fund Mauritius Limited 65,94,800 1.67 1,03,45,290 2.63 3. Macquarie Bank Limited 49,24,371 1.25 1,61,800 0.04 4. Government Pension Fund Global 44,99,996 1.14 64,41,952 1.74 5. Merrill Lynch Capital Markets Espana S.A. S.V. 44,56,370 1.13 11,57,614 0.29 6. Amansa Capital Pte Limited A/C Amansa Holdings Private Limited 38,99,250 0.99 0 0.00 7. Route One Investment Company, L.P. A/C Route One Fund I. L.P. 38,45,160 0.98 0 0.00 8. Route One Investment Company, L.P. A/C Route One Offshore Master Fund I. L.P. 35,04,726 0.89 0 0.00 9. Morgan Stanley Asia (Singapore) Pte. Ltd. 33,90,197 0.86 0 0.00 10. Ashoka Pte. Ltd. 29,40,173 0.75 10,80,969 0.27 0.00 1.74 0.00 0.004 75.00 company % of total Shares of the 96 200 end of the year 16,000 68,59,805 No. of Shares 29,55,63,457 Cumulative Shareholding at the - - - - - 1.74 0.00 0.00 0.004 75.00 company % of total Shares of the - - - - - 96 200 16,000 Shareholding at the beginning of the year 68,59,805 No. of Shares 29,55,63,457 For Each of the Directors and KMP ijaykumar .C. Unnikrishnan - . Kalanithi Maran . V . K. V . R. Ravivenkatesh . S. Selvam At the end of year Mr Mr At the beginning of year Managing Director & CEO At the beginning of year Date wise increase/decrease in shareholding during the year At the end of year Key Managerial Personnel At the beginning of year Date wise increase/decrease in shareholding during the year Date wise increase/decrease in shareholding during the year Mr Date wise increase/decrease in shareholding during the year At the end of year At the beginning of year At the end of year Date wise increase/decrease in shareholding during the year the end of year Mr Mr Executive Chairman At the beginning of year Directors 5. 2. 4. 3. 1. S. No. (v). Shareholding of Directors and Key Managerial Personnel:

19 Annual Report 2014-2015 Sun TV Network Limited otal T Indebtedness Deposits NIL NIL NIL Loans RETURN Unsecured ANNUAL

deposits Excluding ANNEXURE III Secured Loans FORM MGT - 9: EXTRACT OF Amount Amount otal (i+ii+iii) otal (i+ii+iii) i) Principal ii) Interest due but not paid iii) Interest accrued but not due T Change in Indebtedness during the financial year Addition Reduction Net Change Indebtedness at the end of financial year i) Principal ii) Interest due but not paid iii) Interest accrued but not due T Indebtedness at the beginning of financial year . INDEBTEDNESS: V Indebtedness of the Company including interest outstanding / accrued but not due for payment

20 Annual Report 2014-2015 ANNEXURE III FORM MGT - 9: EXTRACT OF ANNUAL RETURN

VI. REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL:

A. Remuneration to Managing Director, Whole-time Directors and / or Manager: (Rs. in Crores)

Name of MD / WTD / Manager Total S. No. Particulars of Remuneration Amount Mr. Kalanithi Maran Mrs. Kavery Kalanithi Mr. K. Vijaykumar

1 Gross salary

(a) Salary as per provisions contained in section 17(1) of the Income-tax Act, 1961 13.14 13.14 0.87 27.15

(b) Value of perquisites u/s 17(2) Income Tax Act, 1961* - - - -

(c) Profits in lieu of salary under section

17(3) Income Tax Act, 1961 - - - -

2 Stock Option - - - -

3 Sweat Equity - - - -

4 Ex-gratia / Bonus 48.13 48.12 - 96.25 21

5 Others, please specify - - - - Annual Report 2014-2015

Total (A) 61.27 61.26 0.87 123.40

Ceiling as per the Act 123.40

*Perquisites amounted to Rs. 39,600/-, Rs. 39,600/- and Rs. 10,800/- respectively. Sun TV Network Limited - - - 8,000 8,000 otal 94,000 86,000 86,000 (Rs.) T Amount - - - - - 20,000 20,000 R. Ravivenkatesh - - - - - 26,000 26,000 M.K. Harinarayanan RETURN - - - - - Name of Directors 26,000 26,000 ANNUAL

Nicholas Martin Paul ANNEXURE III - - - 8,000 8,000 14,000 14,000 S. Selvam J. Ravindran FORM MGT - 9: EXTRACT OF Act otal (2) otal (B) = (1)+(2) otal Managerial Remuneration otal (1) 3. Independent Directors • Fee for attending board / committee meetings • Commission 4. Other Non-Executive Directors • Fee for attending board / committee meetings • Commission Name of the Director • Others, please specify T T T Overall Ceiling as per the T Particulars of Remuneration S. No. B. Remuneration to other Directors:

22 Annual Report 2014-2015 ------0.90 0.90 otal T (give Details) (Rs. in Crores) Appeal made, if any ------T / 0.73 0.73 [RD / NCL COURT] Authority Chief Financial Officer ------Penalty / Details of 0.17 0.17 Punishment / fees imposed Compounding NIL NIL Key Managerial Personnel Company Secretary Brief Description . Act, 1961* the Act Section of Companies T Act, 1961 AUL Act, 1961 ype T alue of perquisites u/s 17(2) Income-tax Particulars of Remuneration Salary as per provisions contained in section 17(1) of the Income-tax V Profits in lieu of salary under section 17(3) Income-tax Stock Option Sweat Equity Commission - as a % of profit Others, please specify TIES / PUNISHMENT/ COMPOUNDING OF OFFENCES: OTHER OFFICERS IN DEF otal (A) (a) (b) (c) 2 3 4 5 T *Perquisites amounted to Rs. 7,200/- and 10,800/- respectively S. No. Penalty Punishment Compounding C. Penalty Punishment Compounding VII.PENAL C.Remuneration to other Directors key managerial personnel than MD/MANAGER/WTD:

23 Annual Report 2014-2015 Sun TV Network Limited

ANNEXURE - IV FORM AOC – 2

(Pursuant to Clause (h) of Sub-Section (3) of Section 134 of the Companies Act, 2013 read with Rule 8(2) of the Companies (Accounts) Rules, 2014)

Form for disclosure of particulars of contracts/arrangements entered into by the Company with related parties referred to in Sub-section (1) of Section 188 of the Companies Act, 2013 including certain arms length transactions under third proviso thereto:-

1. Details of contracts or arrangements or transactions not at arm’s length basis - NIL

2. Details of material contracts or arrangement or transactions at arm’s length basis

a) Name(s) of the related party and nature of relationship - Sun Direct TV Private Limited, Enterprise in which Key Management Personnel or their relatives have significant influence. b) Nature of transaction - Distribution of channels through the DTH platform of Sun Direct TV Private Limited. c) Duration of the transaction - Three years. d) Salient terms of the transaction including the value, if any - Sun Direct TV Private Limited will have the non-exclusive right to distribute Sun TV Network Limited's the channels through its DTH platform and agrees to pay license fee to Sun TV Network Limited. The cumulative total fee shall not exceed the estimated value of Rs. 1,000 crores per annum. e) Date of approval by the Board, if any - 7th November, 2014 f) Amount paid as advances, if any - NIL

This space has been intentionally left blank

24 Annual Report 2014-2015 ANNEXURE - V FORM AOC – 1

Statement containing salient features of the financial statement of subsidiaries/associate companies/joint ventures (Pursuant to first proviso to sub-section (3) of Section 129 read with Rule 5 of the Companies (Accounts) Rules, 2014)

Part “A”: Subsidiaries

(All amounts are in Crores of Indian Rupees)

Name of the Subsidiaries

S. No. Particulars South Asia FM Kal Radio Limited Limited

1. Reporting period for the subsidiary concerned, if different from the holding company’s reporting period 1st April, 2014 to 1st April, 2014 to 31st March, 2015 31st March, 2015 2. Reporting currency and Exchange rate as on the last date of the relevant Financial year in the case of foreign subsidiaries INR INR 3. Share Capital 176.94 483.86 4. Reserves & Surplus (2.45) (169.73) 5. Total Assets 191.04 335.61 6. Total Liabilities 191.04 335.61 7. Investments 33.90 194.25 8. Turnover 74.17 79.08 9. Profit before taxation 27.19 19.50 10. Provision for taxation 1.20 - 11. Profit after taxation 25.99 19.50 12. Proposed Dividend - - 13. % of Shareholding 97.78 % 59.15%

Part “B”: Associates and Joint Ventures

(Pursuant to Section 129 (3) of the Companies Act, 2013 related to Associate Companies and Joint Ventures)

NIL

25 Annual Report 2014-2015 Sun TV Network Limited

ANNEXURE - VI SECRETARIAL AUDIT REPORT

Secretarial Audit Report for the financial year ended 31st March 2015 [Pursuant to Section 204 (1) of the Companies Act, 2013 and Rule 9 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014]

To The Members, Sun TV Network Limited We have conducted the secretarial audit of the compliance of applicable statutory provisions and the adherence to good corporate practices by SUN TV NETWORK LIMITED (hereinafter called ‘the company’). Secretarial Audit was conducted in a manner that provided us a reasonable basis for evaluating the corporate conducts/statutory compliances and expressing our opinion thereon.

Based on our verification of the Company’s books, papers, minute books, forms and returns filed and other records maintained by the company and also the information provided by the Company, its officers, agents and authorized representatives during the conduct of secretarial audit, We hereby report that in our opinion, the company has, during the audit period covering the financial year ended on 31st March, 2015, complied with the statutory provisions listed hereunder and also that the Company has proper Board-processes and compliance-mechanism in place to the extent, in the manner and subject to the reporting made hereinafter:

We have examined the books, papers, minute books, forms and returns filed and other records maintained by SUN TV NETWORK LIMITED (“the Company”) for the financial year ended on 31st March, 2015 according to the provisions as applicable to the Company during the period of audit:

1. The Companies Act, 2013 (the Act) and the rules made there under;

2. The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the rules made there under;

3. Foreign Exchange Management Act, 1999 and the rules and regulations made there under to the extent of Foreign Exchange Management (Current Account Transactions) Rules, 2000, Foreign Exchange Management (Export of Goods and Services) Regulations, 2000, and Import of good and services.

4. The following Regulations and Guidelines prescribed under the Securities and Exchange Board of India Act, 1992 (‘SEBI Act’):-

(i). The Securities Contracts (Regulation) Act, 1956 (‘SCRA’) and the Rules made thereunder;

(ii). The Depositories Act, 1996 and the Regulations and Bye-laws framed thereunder to the extent of Regulation 55A;

(iii). The Securities and Exchange of Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the Companies Act and dealing with client;

(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 2011;

(b) The Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 1992;

26 Annual Report 2014-2015 ANNEXURE - VI SECRETARIAL AUDIT REPORT

(c) The Securities and Exchange Board of India (Registrars to an Issue and Share Transfer Agents) Regulations, 1993 regarding the Companies Act and dealing with client to the extent of securities issued;

(d) The Securities and Exchange Board of India (Issue of Capital and Disclosure Requirements) Regulations, 2009;

(iv) The below mentioned are the laws / Regulations (as amended from time to time), as informed and certified by the management of the Company which are specifically applicable to the Company based on their industry;

(a) Uplinking / downlinking policy / guidelines issued by Ministry of Information and Broadcasting;

(b) The Network (Regulations) Act, 1995 and rules framed thereunder;

(c) Intellectual Property Rights related laws;

(d) Standards of Quality of Service (Duration of Advertisements in Television Channels) (Amendment) Regulations, 2013 issued by Telecom Regulatory Authority of India; and

(e) The Telecommunication (Broadcasting and Cable Services) Interconnection (Digital Addressable Cable Television Systems) Regulations, 2012.

We have also examined compliance with the applicable clauses of the following:

(i) Secretarial Standards issued by The Institute of Company Secretaries of India. (Not applicable for the audit period).

(ii) The Listing Agreements entered into by the Company with the Stock Exchanges, where the equity shares of the Company are listed.

During the period under review, the Company has generally complied with the provisions of the Act, Rules, Regulations, Guidelines, Standards etc., mentioned above subject to the following observations:

1. The Company has partially expended 2% of its average net profits made during the immediately three preceeding financial years as per section 135(5) of Companies Act, 2013 in pursuance of its corporate social responsibility policy since the company is yet to identify suitable projects.

2. The Company has filed a compounding application with the Reserve Bank of India (‘RBI’), Mumbai for regularizing the payment made towards transponder service charges and the same is pending for disposal before RBI.

3. The forms are generally filed with the Ministry of Corporate Affairs within the prescribed time except certain instances of delay.

We further report that there were no actions / events in the pursuance of

(a) The Securities and Exchange Board of India (Share Based employee Benefits) Regulations, 2014

(b) The Securities and Exchange Board of India (Delisting of Equity Shares) Regulations, 2009

27 Annual Report 2014-2015 Sun TV Network Limited

ANNEXURE - VI SECRETARIAL AUDIT REPORT

(c) The Securities and Exchange Board of India (Buyback of Securities) Regulations, 1998

(d) The Securities and Exchange Board of India (Issue and Listing of Debt Securities) Regulations, 2008;

requiring compliance thereof by the Company during the Financial Year under review.

We further report that, on examination of the relevant documents and records and based on the information provided by the Company, its officers and authorized representatives during the conduct of the audit, in our opinion, company is in the process of improving internal control systems and mechanism to monitor and ensure compliance with applicable laws including Industrial Laws, Human Resources and labour laws.

We further report, that the compliance by the Company of applicable financial laws, like direct and indirect tax laws, has not been reviewed in this Audit since the same have been subject to review by statutory financial auditor and other designated professionals.

We further report that:

The Board of Directors of the Company is constituted with a balance of Executive Directors, Non-Executive Directors and Independent Directors. There are no changes in the composition of the Board of Directors that took place during the period under review.

Adequate notice is given to all directors to schedule the Board Meetings, Committee Meetings, agenda and detailed notes on agenda were delivered and a system exists for seeking and obtaining further information and clarifications on the agenda items before the meeting and for meaningful participation at the meeting.

As per the information and explanation given by the Company, its officers and authorized representatives during the conduct of the audit, all decisions at Board Meetings and Committee Meetings are carried out unanimously.

We further report that during the audit period, no events, have occurred which have a major bearing on the Company’s affairs.

For LAKSHMMI SUBRAMANIAN & ASSOCIATES

Lakshmmi Subramanian Senior Partner FCS No. 3534 C.P.NO. 1087 Place: Chennai Date: July 31, 2015

Note: This report is to be read with our letter of even date which is annexed as Annexure A and form forms an integral part of this report.

28 Annual Report 2014-2015 ANNEXURE - VII REMUNERATION POLICY

This policy on Nomination and Remuneration of Directors, Key Managerial Personnel and Senior Management has been formulated by the Nomination and Remuneration Committee (NRC or the Committee) and has been approved by the Board of Directors in compliance with Section 178 of the Companies Act, 2013 read along with the applicable rules thereto and Clause 49 of the Listing Agreement, as amended from time to time.

Objective and purpose: i. To guide the board by laying down criteria and terms and conditions in relation to appointment and removal of Directors, Key Managerial Personnel and Senior Management. ii. To evaluate the performance of the members of the Board. iii. To recommend to the Board a policy, relating to the remuneration for Directors, Key Managerial Personnel and formulate criteria for remuneration payable to Senior Management Personnel and other employees. iv. To provide Key Managerial Personnel and Senior Management performance based incentives / rewards relating to the Company’s operations. v. To retain, motivate and promote talent and to ensure long-term sustainability of talented Senior Management and create competitive advantage through a structured talent review.

Definitions: “Remuneration” means any money or its equivalent given or passed to any person for services rendered by him and includes perquisites as defined under the Income Tax Act, 1961;

“Key Managerial Personnel” means: i) Managing Director, or Chief Executive Officer or Manager and in their absence, a Whole-time Director; ii) Chief Financial Officer; iii) Company Secretary; and iv) Such other officer as may be prescribed.

“Senior Managerial Personnel” means the personnel of the company who are members of its core management team excluding Board of Directors. Normally, this would comprise all members of management, of rank equivalent to General Manager and above, including all functional heads.

APPOINTMENT AND REMOVAL OF DIRECTOR, KEY MANAGERIAL PERSONNEL AND SENIOR MANAGEMENT

I. The Committee shall identify and ascertain the integrity, qualification, expertise and experience of the person for appointment of Director, KMP or at Senior Management level and recommend his / her appointment, as per Company’s Policy. The Committee has authority to decide whether qualification, expertise and experience possessed by a person is sufficient / satisfactory for the position.

ii. The Company should ensure that it appoints or continues the employment of any person as Managing Director subject to the conditions laid down under Part I of Schedule V of the Companies Act, 2013.

iii. To ensure that Company shall appoint or continue the service of any person as Independent Director subject to the provisions of Section 149 read with Schedule IV and other applicable provisions of the Act and Clause 49 of the Listing Agreement.

29 Annual Report 2014-2015 Sun TV Network Limited

ANNEXURE VII REMUNERATION POLICY

TERM / TENURE

a) Managing Director / Whole-time Director: The Company shall appoint or re-appoint any person as its Executive Chairman, Managing Director or Executive Director for a term not exceeding five years at a time. No re-appointment shall be made earlier than one year before the expiry of term.

b) Independent Director: An Independent Director shall hold office for a term up to five consecutive years on the Board of the Company and will be eligible for re-appointment on passing of a special resolution by the Company and disclosure of such appointment in the Board's report.

No Independent Director shall hold office for more than two consecutive terms of up to maximum of 5 years each, but such Independent Director shall be eligible for appointment after expiry of three years of ceasing to become an Independent Director.

Provided that an Independent Director shall not, during the said period of three years, be appointed in or be associated with the Company in any other capacity, either directly or indirectly.

At the time of appointment it should be ensured that number of Boards on which such Independent Director serves is restricted to seven listed companies as an Independent Director and three listed companies as an Independent Director in case such person is serving as a Whole-time Director of a listed company or such other number as may be prescribed under the Act.

EVALUATION The Committee shall carry out evaluation of performance of Director, KMP and Senior Management Personnel yearly or at such intervals as may be considered necessary.

REMOVAL The Committee may recommend with reasons recorded in writing, removal of a Director, KMP or Senior Management Personnel subject to the provisions and compliance of the Companies Act, 2013, rules and regulations and the policy of the Company.

RETIREMENT The Director, KMP and Senior Management Personnel shall retire as per the applicable provisions of the Act and the prevailing policy of the Company. The Board will have the discretion to retain the Director, KMP, Senior Management Personnel in the same position / remuneration or otherwise even after attaining the retirement age, for the benefit of the Company.

POLICY FOR REMUNERATION TO DIRECTORS / KMP / SENIOR MANAGEMENT PERSONNEL

1) Remuneration to Managing Director / Whole-time Directors:

a) The Remuneration / Commission etc. to be paid to Managing Director / Whole-time Directors, etc. shall be governed as per provisions of the Companies Act, 2013 and rules made there under or any other enactment for the time being in force and the approvals obtained from the Members of the Company.

b) The Nomination and Remuneration Committee shall make such recommendations to the Board of Directors, as it may consider appropriate with regard to remuneration to Managing Director / Whole-time Directors.

30 Annual Report 2014-2015 ANNEXURE VII REMUNERATION POLICY

2) Remuneration to Non- Executive / Independent Directors:

a) The Non-Executive / Independent Directors may receive sitting fees and such other remuneration as permissible under the provisions of Companies Act, 2013. The amount of sitting fees shall be such as may be recommended by the Nomination and Remuneration Committee and approved by the Board of Directors.

b) All the remuneration of the Non- Executive / Independent Directors (excluding remuneration for attending meetings as prescribed under Section 197 (5) of the Companies Act, 2013) shall be subject to ceiling / limits as provided under Companies Act, 2013 and rules made there under or any other enactment for the time being in force. The amount of such remuneration shall be such as may be recommended by the Nomination and Remuneration Committee and approved by the Board of Directors or shareholders, as the case may be.

c) An Independent Director shall not be eligible to get Stock Options and also shall not be eligible to participate in any share based payment schemes of the Company.

d) Any remuneration paid to Non- Executive / Independent Directors for services rendered which are of professional in nature shall not be considered as part of the remuneration for the purposes of clause (b) above if the following conditions are satisfied:

i. The Services are rendered by such Director in his capacity as the professional; and

ii. In the opinion of the Committee, the director possesses the requisite qualification for the practice of that profession.

3. Remuneration to Key Managerial Personnel and Senior Management:

a) The remuneration to Key Managerial Personnel and Senior Management shall consist of fixed pay and incentive pay, in compliance with the provisions of the Companies Act, 2013 and in accordance with the Company’s Policy.

b) The Fixed pay shall include monthly remuneration, employer’s contribution to Provident Fund, contribution to pension fund, pension schemes, etc. as decided from time to time.

c) The Incentive pay shall be decided based on the balance between performance of the Company and performance of the Key Managerial Personnel and Senior Management, to be decided annually or at such intervals as may be considered appropriate.

IMPLEMENTATION

I. The Committee may issue guidelines, procedures, formats, reporting mechanism and manuals in supplement and for better implementation of this policy as considered appropriate.

ii. The Committee may delegate any of its powers to one or more of its members.

31 Annual Report 2014-2015 Sun TV Network Limited

MANAGEMENT DISCUSSION AND ANALYSIS REPORT (Pursuant to clause 49 of the Listing Agreement with Stock Exchanges)

The figures have been stated in Rs. Crores for better readability.

Investors are cautioned that this discussion contains forward looking statements that involve risks and uncertainties including, but not limited to, risks inherent in the Company’s growth strategy, acquisition plans, dependence on certain businesses, dependence on availability of qualified and trained manpower and other factors. The following discussion and analysis should be read in conjunction with the Company’s financial statements included herein and the notes thereto.

INDUSTRY

The Indian media and entertainment (M&E) industry is on an impressive growth path with its various segments - film, television, advertising, prints media and music among others witnessing tremendous growth in the last few years. The Indian Government, considering that the industry plays a significant role in creating awareness on many issues that impact the masses and India’s population which is over 1.2 billion has supported growth of this industry by taking various initiatives such as digitising the cable distribution sector to attract greater institutional funding, increasing FDI limit from 74 per cent to 100 per cent in cable and DTH satellite platforms, and granting industry status to the film industry for easy access to institutional finance. In the media and entertainment industry, digital media continued its rapid penetration, the Digital India programme announced by the government of India set to transform India into a digitally empowered society and knowledge economy’. India topped as the world’s fastest growing smartphone market. This growth presents a good opportunity for digital content aggregators, advertisers, app developers and online streaming companies to engage users through relevant mobile-led strategies. The advent of 4G services, healthy growth in the number of 3G subscribers, continued adoption of 2G by the masses in the hinterlands and concerted efforts by various digital ecosystem players under the ‘Digital India’ initaitive, have played a major role in making this growth possible. This is helping in emergence of new business models and revenue streams.

The television industry continued to have a dynamic operating environment in 2014. Television advertising bounced back significantly on account of elections and improved macro-economic environment leading to companies increasing their ad spends. E-commerce emerged as a key sector driving growth, followed by mobile handset companies. The ecosystem for TV ad revenue growth is expected to remain strong in 2015 on account of the rebound in the India growth story. The implementation of the viewership measurement system by Broadcast Audience Research Council (BARC) in 2015, will likely impact the way advertising spend is allocated among different genres and channels, due to inclusion of new markets and increase in sample size.

In the case of Radio Industry the year 2014 was an important year as the Government started proceedings on the much delayed and highly anticipated Phase III auctions. Although the final auctions would be due in the latter half of 2015, the Government has given its nod to the partial auctions for 135 channels in 69 cities. It is believed that Phase III, which had been delayed for more than two years, could herald a new era in the industry.

32 Annual Report 2014-2015 MANAGEMENT DISCUSSION AND ANALYSIS REPORT (Pursuant to clause 49 of the Listing Agreement with Stock Exchanges)

Sun TV Network Limited (Sun Network) maintains its dominant position in the southern states of India as one of the largest television and radio entertainment Company in India with a portfolio of Satellite Television Channels spread across four languages and in genres of GEC, news, music, action, life, movies, kids and comedy. Sun Network also has a large network pan India in the FM Radio broadcasting segment along with its subsidiaries. Sun Network continues to consolidate its leadership position, built over the years, by fortifying its hold over key aspects of pricing and access to quality content. Sun Network has a distinct advantage in the southern regional markets on account of its insightful understanding of the regional preferences and with key competitive strengths including that of a large movie library of regional languages. Sun Network is the preferred choice for content providers as it is the only player with maximum reach in the areas it operates.

OPPORTUNITIES AND THREATS Opportunities: The on going digitalization of content, shift to online and mobile distribution of content and the rapid pace of invocation create opportunities to serve new customers in new markets. The presence of large and wealthy Indian diaspora abroad is another powerful enabler for market expansion abroad.

The M&E industry influenced by digitalization, the convergence of TV, and the poised for a growth trend. The fact that significant households of India are still without television connectivity highlights the scope of growth in the segment. The majority of the revenue generated in the television industry is through advertisements, followed by subscription. Strong growth projected in DTH, Digital Cable segment would result in substantial increase in subscription revenue over the years to come. Increasing interest in regional content among Indian population across the borders, results in increased overseas viewership thereby attracting foreign investment. Radio broadcasting in India, which is still in its infancy, is evolving to be a revenue spinner in the coming years.

Threats: It is difficult to predict our revenues and expenses as they fluctuate significantly given the nature of the markets in which we operate. This increases the likelihood that our results could fall below the expectation of market analysts. Certain threats are summarized below:

ÞAdvertising income continue to be the major source of Sun Network’s revenues, which could decline due to a variety of factors. ÞThe commercial success of Sun Network depends on our ability to cater to viewer performance and maintain high audience shares which could be affected. ÞThe competition and increasing prices may adversely affect our ability to acquire desired programming and artistic talent. ÞSun Network operates in an intensely competitive industry. ÞSun Network is a regional broadcaster, which may limit our opportunities for growth as well as our attractiveness to advertising customers and others. ÞTechnological failures could adversely affect our business. ÞOur inability to effectively deploy and manage funds could affect our profitability.

33 Annual Report 2014-2015 Sun TV Network Limited

MANAGEMENT DISCUSSION AND ANALYSIS REPORT (Pursuant to clause 49 of the Listing Agreement with Stock Exchanges)

SEGMENT Sun Network operations predominantly relate to a single segment “Broadcasting”. OUTLOOK Sun Network with its presence across genres like general entertainment, movies, music, news, kids, action, life and with a dominant market share in the four southern states of India (Tamil Nadu, Kerala, Karnataka and Andhra Pradesh) ensures continued and sustained viewership and prominent role in the Media and Entertainment Industry. A steady flow of highly popular programs and a dominant share of audience viewership have given the network tremendous pricing power vis-a-vis competitors. The drive initiated by Government towards digitalisation and addressability for cable television would help Sun TV Network, being the largest regional television network to be one of the major beneficiaries of the recent growth in the DTH space, it is expected that this new stream of revenue for the Company arising from the increased DTH subscriber base in South India would maintain a positive momentum in the coming years. FINANCE AND HUMAN RESOURCE Finance: The Total Income for the year ended 31st March 2015 was Rs.2,331.45 crores as against Rs.2,175.99 crores during the previous year ended 31st March 2014. Profit Before Tax was Rs.1,111.99 crores as against Rs.1,084.71 crores in the previous year. Profit After Tax was Rs.737.23 crores as against Rs.716.96 crores in the previous year. During the financial year ended 31st March 2015, the Board of Directors has declared Interim Dividends of Rs.2.25/- per equity share (45%), Rs.2.25/- per equity share (45%) and Rs.6.75/- per equity share (135%) declared at the Board Meetings held on August 8, 2014, November 7, 2014 and February 6, 2015 respectively and have not recommended any Final Dividend. The dividend payout would result in a total dividend of 225%, i.e., Rs.11.25/- per equity share of face value of Rs.5.00/- each for the financial year ended 31st March 2015. (Prev. Year of 190%, i.e., Rs 9.50/- per equity share of face value of Rs.5.00/- each). The Reserve and surplus of the Company as on 31st March 2015 stood at Rs. 3,182.66 crores as against Rs. 2,974.76 crore